Wednesday, August 26, 2009

No wonder we have trouble exporting democracy...

...given that the product we produce domestically is of such low quality, it is perhaps not surprising that it hasn't been a best selling export.

On the one hand we have a President promising painless pie in the sky and on the other we have the opposition claiming that Obama wants to kill your grandma.

Who wouldn't want to buy that?

And we keep getting distracted by side issues, like the presence or absence of a "public option".

To my mind, the biggest issue is cost. We have just been given a figure of 9 trillion in additional Federal debt expected over the next decade. This number assumes fairly large tax increases over the current situation and does not reflect additional debt that might accrue due to health care legislation.

If we are going to insure everyone, regardless of pre-existing conditions and not let premiums reflect risk, then premiums for healthy people are going to go up, not down, and the subsidy required for lower income folks to hold these policies are going to be extensive.

The government can't make reality go away by legislation, and they cannot borrow unlimited amounts of money without seriously adverse consequences.

6 comments:

Anonymous said...

harumph!

Don Taylor said...

pretty sure the 9 trillion assumes the tax rates will be maintained to keep the no taxes on folks under 250k pledge intact....CBO estimate of 7.1T over 10 assumes all the tax cuts (2001, 2003) go away and rates return to end of clinton rates which is default due to sunset provision. OMB factors in changes they anticipate, CBO assumes no change in anything. Correct no health bill stuff in either of these estimates.

Angus said...

I agree Don, except I call when taxes go up a tax increase and it seems like you don't.

Don Taylor said...

Of course if rate goes up it is an increase. Do I have it straight?: OMB is assuming legislation will be passed to maintain the rates set by 2001/03 tax cuts. CBO assuming there will not be such legislation passed(because CBO always assumes default, which is sunset in this case) and that tax rates will increase back to where they were at end of Clinton/beginning of Bush admin. That is the source of the 1.9Trillion dollar difference in the estimates.

nancy said...

This is a beautiful post. I could not agree more. Keep writing!

This is Nancy from Israeli Uncensored News

Tom said...

The "no taxes on folks under 250k pledge" is already out the window. Obama support a huge new tax on carbon. This will be paid by people who use energy without regard to their income.

Of course it's a hidden tax! You didn't expect honesty, did you?